Red Bull Formula One drivers Daniel Ricciardo (left) and Max Verstappen swopping their racing suits for American football gear before the United States Grand Prix.
The Dutchman, whose previous Red Bull deal was due to expire at the end of 2018, had attracted the attentions of Ferrari and Mercedes.
He said: "Red Bull has always shown their faith and belief in me". "Of course we had our ups and downs this year but as you can see they've been working very hard to get better and again today it showed that we are very competitive and I really enjoy it here with the team and I think that's also really important and that's why I chose to extend".
Red Bull handed Verstappen his first big break in Formula One, when he was promoted to the senior team in May 2016, winning his debut race during the Spanish Grand Prix.
Red Bull team boss Christian Horner said: "We are delighted that Max has agreed to extend his contract with Red Bull Racing".
"For Max, the positive is he and his team, his management and his dad [Jos], feel confident with Red Bull, so it's positive for us for next year and it gives the team confidence".
"He is pure racer, with an undeniable talent at the wheel and a rare instinct for what it takes to compete consistently at this level".
Along with Verstappen, Renault's Nico Hülkenberg, McLaren's Stoffel Vandoorne and Toro Rosso's new driver Brendon Hartley have all been hit with penalties this weekend for power unit-related changes.
In some ways the move is a surprise - Red Bull's future is clouded in questions, especially over their engine supplier.
That makes it likely Red Bull will use Honda engines in 2019, which would be a major blow to their competitiveness if the Japanese company can not improve its performance.
Verstappen finished fourth fastest in the wet-dry morning session on Friday but was second best to Lewis Hamilton in the afternoon, and he believes Red Bull could be in the hunt for a good result this weekend.
Laying out his reasoning for making a longer-term commitment to Red Bull, Verstappen said he was motivated by his belief that the team "can build the best auto on the grid".